An Introduction to Financial Fitness

The following excerpt was taken from the book, Financial Fitness, by Chris Brady and Orrin Woodward.

Think back to your earliest memories about money. When did you first realize that money had the power to purchase things you wanted? When did you first wish you had enough money for something? When was the first time you were told you couldn’t have something because you couldn’t afford it? When was the first time you remember holding a lot of money in your hand and feeling really happy about it?

Now ask yourself another question: When you think back on your earliest memories about money, do the memories make you feel mostly positive or negative? For many people, early memories about money are often associated with a sense of lacking, of not having enough for something they wanted. Sadly, this feeling of lack, which we call “the money thing,” is too often the way many people still feel today.

This feeling comes with the realization that you can’t afford something you really desire, or that you don’t have the resources to do something you really want to do, or even that you aren’t able to help someone you care about simply because you lack the necessary money. Most importantly, “the money thing” sometimes keeps people from fully achieving their potential and living their deepest purposes in life.

Of course, there are a number of things that are more important than money, but “the money thing” is a limiting factor for far too many people. Both Orrin and I experienced this challenge during our youth, and as adults, we set out to discover how to overcome it.

As far back as I can remember, I wanted to succeed financially. I guess I learned early that money was a necessary tool, and if lacking, was instead a major inhibitor. I wouldn’t say I ever went as far as greedy materialism; rather, I was focused more on “making it” and eliminating “the money thing.” It seemed as if money was a roadblock in many people’s lives, obstructing their paths and telling them they could proceed no further.

“We can’t afford it” was a phrase I grew up hearing a lot, both at home and from many people in my community. It seemed to be the major limit for most people.

But as a young person, I wondered, “Why can’t I grow up and make a bunch of money? Why can’t I find a way to kill the money limiter once and for all and be free to live my life the way I desire, rather than being hindered by a lack of money at every turn?”

So, of course, I began chasing financial success through the fantasy of becoming a professional motocross racer. It was only a teenage fantasy and quickly dissipated in the face of several facts—the first being that I wasn’t good enough! So I shifted gears, so to speak, and embraced the “go to school, get good grades, get a good job, and work your way up the corporate ladder” philosophy of success. This produced some results and a decent income, but it was also like wearing someone else’s shoes—fine for someone else but not fitting for me. I was working as an engineer at General Motors at the time, but something just didn’t feel quite right.

A crossroads in my life came one day when I found myself on a Caribbean beach asking some very important questions: “Is this it? Is this all there is? Is this the life I want? Should I settle for good, or should I risk it all and go after my dreams?”

This experience helped me step off the “normal” path of a good job and a life in the suburbs to truly living my dreams. But the path wasn’t easy. After I became an entrepreneur and went through many starts and stops, I finally found my way to the types of income I had always desired. This, however, was not enough. Making money was only the “offense” of personal finances. I still had many lessons to learn about the “defensive” side of finances and the preservation and proper stewardship of wealth.

It was through careless handling, hopeful and naïve investing, and many hard knocks, losses, bad decisions, unscrupulous investment partners, reckless real estate transactions, and other failures that I learned the lessons that finally stabilized my financial condition and fixed me upon a definite opinion about how to build wealth and manage one’s finances.

Worst of all, I had all along thought I was being wise with my money, trying to do with it what “everyone” had always recommended. I didn’t waste it on the proverbial “wine, women, and song” (I am happily married, hardly ever drink, and certainly can’t sing!), but instead attempted to invest my money and grow it responsibly. Only then did I find out how much I still had to learn.

It turns out that nearly “everyone” is wrong when it comes to personal finances, and from that consideration grew the very concept of the book, Financial Fitness.

Between the two of us over the years, we have worked with hundreds and then thousands of people struggling to improve their finances, and we have seen time and again that a few simple changes make all the difference. In fact, it is amazing how little is really needed to turn things around and get on the path to financial fitness and prosperity.

In truth, the principles of financial fitness are not complex or difficult. Unfortunately, far too few learn these simple, basic principles that can fix their finances. Most people seem predisposed to stay in a rut unless something significant urges real change. If you live in a forest your whole life, you’ll most likely think the world is made up of trees, just like a fish will probably think the whole world is water. This reminds us of Plato’s story about the prisoners locked up in a cave who just assume the whole world is a cave.

The same is true of understanding money. If your parents struggled with money and didn’t know or apply the principles of financial fitness covered in this book, you most likely struggle as well. Some people learn the principles of money success by trial and error like we did, and some learn from mentors. But unless a person learns these principles and applies them in everyday life, he or she will continue to struggle financially.

Our schools seldom teach these principles, and it is difficult to find them all in the various books on the topic. Though there are a lot of writings on personal finance, including many that teach some of these principles of financial fitness, it is difficult for readers to plow through dozens of books just to find a principle here and another there.

The principles of financial success are relatively few and simple, but we haven’t been able to find them effectively and thoroughly taught in one place in a way that truly helps people get their financial house in order. In fact, nearly all books now available on the topic fall into one of three categories:

Books on financial “offense” that explain how to make money, like the works of Robert Kiyosaki and David Bach and the many books on investing, entrepreneurship, and real estate

Books on financial “defense” that explain how to save, budget, and get out of debt, like the writings of Dave Ramsey, Suze Orman, and dozens of others on overcoming debt

Books on the “playing field,” or the “rules and philosophy,” of finance that explain how money works and how to understand economics, like titles by Ludwig von Mises, Peter Schiff, and Murray Rothbard

But there is a great need for a single book that adequately teaches all three of these viewpoints and the skills of each because readers who get too caught up in offense will make drastic mistakes on the defensive side of things, while others who emphasize defense will limit their potential by not taking important offensive actions to increase their prosperity.

Those who focus mostly on the playing field, or the rules and philosophy approach, will have a good understanding of tax policy, the gold standard, or the benefits of a 401(k) but little real control over their financial goals.

We need to learn financial offense and defense, which can be summarized as “earning like a millionaire and living like the middle class.” Too many people do the opposite and earn like the middle class but use debt to spend like they have a lot more than they do. The financially fit, in contrast, spend a lot less than they make. Sadly, few people in modern society consistently apply the principles of financial success.

On a personal note, we feel so blessed that since those experiences on the Caribbean beach and listening to an audio tape while driving to a class, we’ve been able to learn the principles of financial fitness. Herein are the results of twenty years of wins and losses, gains and failures. Herein lies not advice, as we do not deign to advise anyone, everyone’s situation being different. We have learned that the principles of financial fitness work, and those who apply them will get financially fit.